India: Agricultural sector is ready for tech-enabled makeover

By Padmaja Ruparel, Founding Partner of IAN Fund

Cutting-edge technology in the agriculture sector has become the need of the hour; it will not only help modernise the sector and increase yields but will also make it more cost-effective and improve livelihood for farmers

Agriculture is the main source of livelihood for 58 percent of the Indian population and it represented almost $300 billion of gross value add in FY20. However, the annual growth in this gross value add is a mere 3 percent. This represents the lack of innovation that this critical sector has experienced over decades, however, it also represents the huge opportunity for innovation and technology.

Farmers face fundamental issues including lack of information on farm inputs, unorganised credit, and absence of market linkages. To put things in perspective, most farmers are compelled to use the traditional channels to purchase raw materials such as seeds, fertilisers, and other farming products. Moreover, almost 30-40 percent of the total harvest gets wasted at various levels of the distribution or supply chain, which amounts to very low earnings for farmers.

Thus, the sector is ripe for technology intervention which can morph the agricultural landscape of the country for the better. Cutting-edge technology in the agriculture sector has become the need of the hour. It will not only help modernise the sector and increase yields, it will also make it more cost-effective at the same time. In fact, tech-based solutions may further help in addressing structural problems such as the presence of numerous middlemen, bringing the farmers closer to the consumers, improving yields per acre, picking the right crops for better earnings, the efficient use of resources such as water, and improving quality with the right inputs. This will also support newer farming methods such as vertical farming, hydroponic farming, and so on. Innovation can also improve storage, distribution/supply chain, food processing, and packaging.

Today, the country is seeing a plethora of agri-tech startups that are addressing these problems. They are bringing in layers of data analytics to drive efficiency and informed decision making. The companies have leveraged Artificial Intelligence (AI), data science, Internet of Things (IoT), drones, robotics, building automated supply chains, and to build the next layer of data analytics to drive efficiency. Further, AI-based use cases such as automated weeding, agricultural robots, pest prediction and prevention, crop yield estimation, and so on, can help in enhancing farm productivity as well as empower farmers to improve operational efficiency while cutting down on manual labour.

For instance, a Kochi-based agri-tech startup—Farmers Fresh Zone—has introduced unit-level traceability for all products that help consumers track the origin of a product. For farmers, the startup is providing the right mix of price and products while improving their earnings and reducing wastage. This approach is implemented to bridge the gap between the consumers and the farmers.

Like Farmers Fresh Zone, there are hundreds of other agri-tech startups in India that have taken centre stage to solve the current problems that farmers face. From educating them about different agricultural practices; weather forecasting, to equip them with the right techniques and tools to grade, assort; to sell their produce online, these startups are playing a game-changing role in modernising the agriculture system in India. Interestingly, these companies are not only technology-based but are also driving device and hardware innovation.

In a nutshell, agri-tech startups are gradually but surely changing the face of the Indian agriculture sector. Closer engagement between stakeholders, government, and startups to provide infrastructure and policy support is imperative. It will enhance the development of tech-enabled solutions across the sector. These technological interventions in providing low-cost farming solutions, backed by numerous public and private funding as well as a strong digitised infrastructure, have the potential to further bring in transparency in the supply chain and transform India’s agriculture sector in the upcoming years.